Archive for Friday, October 18, 2002

Low mortgage rates boost home construction

October 18, 2002

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— Low mortgage rates drove housing construction in September to the highest level in 16 years, but the nation's industrial sector showed new signs of stress, confirming that economic recovery remains uneven.

"Overall, we're walking a tightrope on a breezy day, but we're getting closer and closer to the other side," said Bill Cheney, chief economist at John Hancock Financial Services. "The absence of really bad news is a positive sign."

The Federal Reserve reported Thursday that factory production declined in September for the second straight month, and the Commerce Department reported that more Americans filed new claims for jobless benefits. But the huge increase in housing construction helped to leaven that news.

The number of housing projects started in September climbed to a seasonally adjusted annual rate of 1.84 million units, a 13.3 percent jump from the previous month.

It was the highest level of housing construction since June 1986.

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